EAC29 Mar 2024 08:00
A new day so I’ve re read yesterday’s RNS together with the previous ones. I’m not seeing a vast change in position from the 19th February RNS. Yes, the company is deep trouble, but we already knew that, and has a distinct possibility of going into administration, but we already knew that. AND, yes an increased possibility.
The 19th February RNS talks about Estimate at Completion (“EAC”) and Cost-to-Complete (“CTC”). The EAC being US$1,004 million, comprised of US$479 million spent up to date, US$52 million is outstanding to trade creditors, US$15 million for critical activities during the slowdown period and US$4 million pre-first metal mining costs, and a CTC of US$454 million.
Yesterday’s RNS takes a different view, so not truly comparable. It talks about the money needed and current liabilities. So does EAC equal liabilities plus new funding?
Liabilities are US$418 million, comprised of US$241 million in senior debt, a US$27 million cost over-run facility (“COF”), US$68 million to trade creditors and US$82 million of convertible loan notes, and a restructuring solution for its existing royalties arrangements.
New full funding required to complete construction and bring the operation to positive cashflow is US$567 – 592 million. This consists of the Project CTC of US$454 million, as announced on 19 February 2024, plus US$89 million of pre-production costs, ramp up costs, general & administration and working capital required to bring the operation to positive cash flow, and US$25 - 50 million that relates to transaction costs and a minimum cash contingency.
So EAC of US$418 million plus US$592 million US$1,010 million.
I must be missing something, please explain! Genuine answers only.
Sign In
Follow the stocks
